Last year I did a speaking tour of Australia and one of my session was a business excellence program for an organization called The Growth Faculty. A young lady named Kasey Patterson attend that workshop and recently sent me this question. I thought you might find a few ideas for your business in my response.

Hi John & Sheila

I attended the growth summit last year and saw John present. What an informative session. Thank you.

The reason for my email is that I have just watched your keys to success for 2018 video and have a questions in regards to competition and thinking outside your industry. We are a Financial Planning business and I have been thinking hard about competition outside our industry – ie banks, accountants, but that is where my mind stops. Who else would you consider our competition?

Kind Regards

Kasey

Kasey, it’s funny, I was just watching that video myself because someone else asked me a question about it. So as a financial planner/advisor you likely get paid a percentage of the amount of money you manage for someone, or at least that’s how it works here in the United States. But no matter what, here are a few things I might consider competition/replacements if I were a financial planner.

Anything expensive that someone buys would compete for them saving for their retirement. So vacation homes, private airplanes, boats, motorcycles, around the world vacations, buying a new home, sending their kids to an expensive school/university – at some level, all of these could be considered replacements for saving my money and allowing you as my financial planner to manage it.

Another competitor would be startup companies that are seeking angel funds. Instead of giving money to my financial planner, I invest it in a company in hopes that I will have a much larger return.

Here’s a big one, bitcoin!!!

You could probably throw gold in on that list too, as another type of currency.

You compete against collectibles: artwork, cars, rare coins, antiques, and other such items.

You compete against people who decide to do it for themselves and think they don’t need a financial planner. Or, they use someone in their family to help them invest.

You compete against ignorance and apathy; people who don’t know that they need a financial planner or who don’t care.

You compete against nonprofits and other charities that will seek major donations from your potential customers, again, reducing the amount of money they have to invest with you.

You compete with ill health. If someone gets sick and has to spend a lot of money on care.

You compete with death. If someone in their family dies and does not have adequate life insurance then your potential customer might spend a large chunk of their money taking care of the funeral costs and other financial obligations of the deceased person.

You compete with disasters. If there is a major fire/flood/earthquake that wipes out one of your customer’s businesses or homes and they do not have adequate insurance they will not have enough money to invest with you.

Okay, I’m starting to run out of ideas here, but those are a few off the top of my head. Give this some more thought and let me know if you come up with any more.

I hope you found this helpful – John

I followed up with this last idea…

Kasey, I forgot the most important competitor of all… You. You are constantly competing against other financial planners, but the number one financial planner that can do the most harm to you is you. If you lack discipline, if you are not working incredibly hard every day to keep your current clients exceedingly happy, if you’re not constantly studying and trying to get better, if you are not out networking and asking for referrals, if you are not trying to be among the best in your industry… you are your own worst competition.

So, who do you compete against in your business?

Here is a link to the video Kasey mentioned if you’d like to watch it: Click Here

This is an excerpt from a new book I am working on about how to generate more high quality referrals.

Several years ago I was brought in to help a computer training company increase their sales. The sales team were missing their numbers badly and the business was in serious trouble. When I got there I found out that many of the salespeople were uncomfortable because the price for their training program was nearly $40,000, which was a very high price point for the potential customers they were talking to. Each of the salespeople had a quota and there was a large white board in the sales office tracking exactly how much money each person had brought in. The sales were basically being managed as a numbers game.

To understand the situation better I asked a few questions.

What was the graduation rate for people who entered the course? Which I found out was above 90%. What was the placement rate for students who had graduated from their computer training? I found out was above 90%. What was the average salary of someone who graduated and got one of these jobs? About $80,000 a year. For the people they were talking to, what was their current average salary? Which I found out was about $30-$40,000, hence the reason a $40,000 training program was extremely expensive for them.

I brought the sales team together to talk with them. I explained to them that when someone bought one of these programs and invested $40,000, there was a 90% chance they would graduate and be a certified computer technician and a 90% chance that they would get an awesome job at a very high salary that would completely change their lives and the lives of their families. They would finally have a good paying job in a growing industry where they could build a solid career and continue to improve their income. I told the sales team to stop worrying about the quota and start worrying about how many people they could help, how many lives they could change. I told them not to be greedy about money, but to be incredibly greedy about how many people they could help. Once they were able to make the mental shift from making sales – to changing people’s lives – the sales numbers went through the roof.

It is the exact same thing for asking for referrals. It is not about new clients, new revenue, more profits for you and your business – it’s about how many more people can you help. There’s an old saying from Zig Ziglar that I love: “If you just help enough other people get what they need you’ll get everything you need.” This is the heart of generating lots and lots of quality referrals – be fanatic about getting as many referrals as you possibly can, so that you can help as many people as you possibly can. Look at it that way and you will do very well.

In one of the greatest self-help books ever written, Napoleon Hill’s “Think and Grow Rich,” the author states that one of the Universal Master Keys to Success is creating mastermind groups (a small group of experts, advisers and mentors that focus on assisting you with your business, career and life). I could not agree more, as I’ve stated many times the most important thing I’ve ever learned is: You become what you focus on and like the people you spend time with. Along those same lines, it is also my firm belief that one of the Universal Master Keys to business success is: Referrals. Continue reading “A Universal Master Key to Business Success” »

Last week I had lunch with the president and the director of “communication and exploration” of one of the most interesting and impressive companies I have ever encountered. The name of the firm is ThemeWorks and they design and create absolutely incredible, innovative and highly accurate “themed fabrications” for museums, theme parks, zoos and other attractions. In other words, they build really cool shit! (Go look at their website and you will see what I mean – these people are amazing artists: click here).

After spending some time discussing the mind-blowing projects I had the chance to look at in their studio, the conversation turned to how to grow the company and expand its reach into new markets (such as designing and creating themed environments for large corporations who do multiple trade shows every year) . Like many companies, ThemeWorkshad grown from a few friends working out of an apartment into a large and highly successful organization based almost 100% on: word-of-mouth referrals.

As Scott, the president and founder of the company put it, “I just figured if we did really, really fantastic work and treated our customers great, they would continue to give us their business and tell all their friends about us.” And they did! And the company grew and grew!! But what I told Scott is that in order to take it to the next level you cannot simply “hope” that exceedingly happy customers will continue to drive new business and new customers to your door – you must become proactive in helping your very satisfied customers actively send you highly qualified new customers through a system and process of generating large numbers of superb referrals.

Let me use myself as an example. For the first 15 years of my career as a corporate trainer, professional speaker and executive coach I figured that if I just did 10 times more work than my peers, came in early and stayed late, sweated every single detail and dedicated myself to adding more value and being more customer focused than any other person in my industry… everything would work out fine. And it did! My very happy customers referred me to lots of other great customers and kept me just about as busy as I could possibly handle for more than a decade. But in the last few years even my best customers have had to cut back on their training and events budgets and I found myself, for the very first time in my career, in the position of having to actively pursue new clients and ask for referrals. It was then that I ran across the work of John Jantsch and his wonderful book “The Referral Engine” and attended one of his seminars where he helped me understand that building a steady stream of excellent referrals must become a strategic objective of your firm with a process to ensure that it is flawlessly executed.

I told Scott that what I have learned was instead of totally busting my butt to make sure I delivered far beyond the customer’s expectations and then “hoping” that I would get some good referrals, I now set a clear expectation with my clients before I deliver my program by saying to them… “If I deliver program that significantly exceeds your expectations, and I get the highest scores possible from the attendees of my speech, I am going to ask you to promise to send a personal letter of referral to at least 20 of your peers and strongly encourage them to do business with me.”Because I share this expectation at the beginning of the relationship, before I have delivered any training or speeches, and tell them that I am only asking for a referral if I 100% earn it by doing a world-class job… the client is typically very accommodating and will happily agree to the deal. It is then incumbent upon me to spend every waking moment to make sure that I deliver on all of my promises and clearly exceed their expectations. If I do that (which is what I strive to do every time I step in front of an audience), I now have a client who has made a personal promise to send 20 very enthusiastic referrals to their top clients and colleagues. Wow – talk about a referral engine! Imagine if every one of your top customers sent 20 strong referral notes for you next month – there is no doubt that it would have a huge positive impact on your business.

So Here Is The Lesson: for many, many companies 85% or more of their new business comes directly from word-of-mouth referrals (for me it is 99%) – therefore if you want to generate the most quality referrals possible it is critical that you change from a reactive stance of “hoping” that your clients will send you referrals – to a more proactive stance that sets the upfront expectation of: “If I absolutely deliver superior quality and value to you Mr. or Ms. Client, I am going to expect you to send out 20 or more superb personal referrals to key clients that you feel would truly value the kind of work I just delivered for you.”

Important Question:Have you created such a referral process to ensure that your customers actively refer you to highly qualified potential new customers?

Most Important Question:If you are one of my clients (or just somebody who really likes the work I do) have you sent the 20 wildly enthusiastic referral notes on my behalf yet?????

I hope you found this post helpful, I look forward to your questions, comments, concerns, feedback and… referrals. Have a fantastic day – John Spence